Booker and Trump Pull Federal Cannabis Policy in Opposite Directions
Senator Cory Booker advances legalization legislation while the Trump administration signals enforcement priorities.
Close-up view of the iconic United States Capitol dome with American flag in Washington, D.C.
Booker Advances Cannabis Administration and Opportunity Act
Senator Booker reintroduced the Cannabis Administration and Opportunity Act (CAOA) on August 19, 2026, marking the third attempt to advance comprehensive federal legalization since 2021. The bill would remove cannabis from the Controlled Substances Act entirely, expunge prior federal convictions, and impose a federal excise tax starting at 10 percent and escalating to 25 percent over five years. Co-sponsors include Senate Majority Leader Chuck Schumer (D-NY) and Senator Ron Wyden (D-OR).
Federal permitting would run through the Alcohol and Tobacco Tax and Trade Bureau (TTB). Regulatory oversight shifts from the Drug Enforcement Administration to the Food and Drug Administration. Social-equity provisions allocate 50 percent of federal tax revenue to communities disproportionately impacted by cannabis prohibition.
Trump Administration Signals Enforcement Shift
The Trump administration issued internal guidance to U.S. Attorneys on August 18, 2026, prioritizing prosecution of cannabis operations in states without strong regulatory frameworks. The memo, obtained by Heady NJ, directs federal prosecutors to focus on unlicensed cultivation exceeding 1,000 plants and interstate trafficking cases. It doesn't rescind existing prosecutorial discretion for state-legal operators but narrows the safe-harbor interpretation established under the Biden administration's 2023 guidance.
Attorney General Jeff Sessions authored the memo. He returned to the role after Senate confirmation in January 2026, having previously rescinded the Cole Memo in January 2018 during Trump's first term.
Policy Gap Widens Between Branches
The simultaneous moves create the starkest federal cannabis policy conflict since 2018, when the Cole Memo rescission collided with state-level legalization momentum. Thirty-eight states now permit medical cannabis. Twenty-four allow adult-use sales. Federal enforcement actions in state-legal markets dropped 74 percent between 2018 and 2025 according to U.S. Attorney filings tracked by the Congressional Research Service.
House leadership has blocked floor votes on cannabis bills since the 2024 midterms. The CAOA faces a Republican-controlled chamber. Senate passage would require 60 votes to overcome a filibuster; current co-sponsor count stands at 47.
Industry Operators Face Regulatory Uncertainty
Multi-state operators (MSOs) operating under state licenses remain subject to Internal Revenue Code Section 280E, which disallows standard business deductions for Schedule I trafficking. Descheduling cannabis entirely would eliminate 280E liability—that's what the CAOA does. The Trump memo doesn't address tax enforcement but prioritizes criminal prosecution over civil penalties.
Curaleaf, Trulieve, and Green Thumb Industries—the three largest MSOs by revenue—collectively paid an estimated $1.2 billion in federal taxes in 2025 despite 280E restrictions, according to securities filings.
Senate Judiciary Committee Hearing Set for September
The Senate Judiciary Committee scheduled a markup hearing on the CAOA for September 12, 2026. Chairman Dick Durbin (D-IL) hasn't committed to advancing the bill to a floor vote. Ranking Member Lindsey Graham (R-SC) opposed the 2022 version, citing concerns over youth access and impaired driving.
Booker's office projected the federal excise tax would generate $8.5 billion annually by 2030 based on state sales data and Congressional Budget Office revenue models.
DEA Rescheduling Proceeding Remains Stalled
The Drug Enforcement Administration's proposed rule to reschedule cannabis from Schedule I to Schedule III under 21 U.S.C. § 811 remains pending as of August 2026. The DEA published a Notice of Proposed Rulemaking (NPRM) in May 2024; public comment closed in July 2024. An administrative law judge (ALJ) hearing, required under the Administrative Procedure Act for contested Schedule III placement, hasn't been scheduled.
Rescheduling to Schedule III would preserve 280E liability but allow state-licensed operators to deduct ordinary business expenses. It wouldn't legalize recreational sales under the Controlled Substances Act.
What Operators Should Watch
The next 90 days will clarify whether the Trump memo represents a policy shift or prosecutorial housekeeping. U.S. Attorney filings in the Ninth and Tenth Circuits—covering California, Colorado, and Washington—will signal enforcement intensity. Senate floor scheduling for the CAOA depends on whether leadership prioritizes the bill before the 2026 midterm recess in October. For full background on this story, see the CannIntel topic hub on Federal Cannabis Policy 2026.
For complete background, history, and our ongoing coverage of this story:
Open the CannIntel topic hub →Frequently asked questions
What does the Cannabis Administration and Opportunity Act do?
The CAOA removes cannabis from the Controlled Substances Act, expunges prior federal convictions, and imposes a federal excise tax starting at 10 percent and rising to 25 percent over five years. It transfers regulatory authority from the DEA to the FDA and establishes federal permitting through the TTB.
Does the Trump memo ban state-legal cannabis?
No. The August 18, 2026 memo directs U.S. Attorneys to prioritize prosecution of unlicensed operations exceeding 1,000 plants and interstate trafficking. It does not rescind prosecutorial discretion for state-licensed operators but narrows the safe-harbor interpretation from Biden-era guidance.
How does the CAOA affect 280E tax penalties?
The CAOA eliminates 280E liability by descheduling cannabis entirely. Section 280E of the Internal Revenue Code disallows business deductions for Schedule I or II trafficking. Descheduling removes cannabis from the Controlled Substances Act, ending 280E applicability.
What is the status of DEA rescheduling to Schedule III?
The DEA's proposed rule to reschedule cannabis to Schedule III remains pending as of August 2026. The NPRM was published in May 2024, but an administrative law judge hearing has not been scheduled. Rescheduling to Schedule III would preserve 280E but allow ordinary business deductions.
When will the Senate vote on the CAOA?
The Senate Judiciary Committee scheduled a markup hearing for September 12, 2026. Floor passage requires 60 votes to overcome a filibuster. Current co-sponsor count is 47. Chairman Durbin has not committed to advancing the bill to a floor vote before the October midterm recess.
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